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The photography pioneer Kodak has been dogged by bankruptcy rumors, its stock has tumbled, and its cash reserves have shrunk. But the company says it expects a strong fourth quarter as it fights toward profitability in 2012.

"I grew up in a Kodak family — aunts, uncles, father, brother-in-law," says Linda Nau. Her connection to the company is similar to that of a lot of native Rochesterians. Nau herself even worked at Kodak.

As a college kid in the late '60s, she was paid $10 an hour for a summer job making sure film canisters didn't let in light. But now, more than 40 years later, Nau is helping her husband pick out a new camera in a Rochester-area Best Buy store.

And Kodak is not part of the conversation.

"Why?" she says. "I don't think the quality of the Kodak cameras are as good as they used to be."

During holiday shopping season on Kodak's home turf, you might assume this is troubling news for the imaging giant. But, according to Kodak, you'd be wrong.

The New Kodak

"We expect a very good fourth quarter," said Kodak CEO Antonio Perez.

Kodak declined to speak with NPR for this story, but Perez spoke on the company's investor conference call last month. He said that things are looking up.

"All four of our digital growth businesses will expand in the fourth quarter," Perez said.

But none of those are camera businesses. Kodak even recently sold off its image-sensor division, reportedly for a couple hundred million dollars.

Kodak has long been in the process of a painful transformation that's seen tens of thousands of Kodak workers in the Rochester area lose their jobs.

When Perez talks about the company's "digital transformation" and the "new Kodak," he's talking about four growth businesses in particular — three of which serve the commercial printing industry.

Perez says, "They will be the nucleus of the new Kodak."

In short, Kodak is becoming a company that makes high-end printing equipment — not a consumer staple whose brand once rivaled Coca-Cola's in global ubiquity.

Kaufman has seen the company's stock plummet in the last year, driven by investor fears that Kodak is on its last legs. These fears were driven by a recent move to tap a revolving credit line, the shuffling of key legal advisers, and higher-than-expected losses that have sunk Kodak shares to less than a dollar.

But Kaufman says there is some reason for optimism.

Fourth-Quarter Optimism

"This is an important quarter," he says, "because they've actually started to make some inroads in getting the cash on the balance sheet."

Kaufman expects Kodak to finish up the year in relatively decent shape.

An upcoming patent sale could net the company billions. Several of Kodak's massive, $3 million printing presses will come online in Asia. Once they're up and running, they run exclusively on Kodak inks and print heads.

Kaufman even says a seasonal surge in movie film and catalog printing creates an inflow of cash.

"If you really think about who the end users are," Kaufman says, "[they're] more businesses than individual consumers."

This brings us back to Linda Nau at the Rochester-area Best Buy.

Of the four pillars of the "new Kodak," only one — desktop inkjet printing — is consumer-oriented.

While Kodak digital cameras have been relegated to the Best Buy website because of poor sales, you can get a Kodak printer at the store. Nau isn't buying. She already has a printer — made by Canon. But when she prints out photos, she does use Kodak paper.